In the wake of debate regarding superannuation fund fees, the Association of Superannuation Funds of Australia (ASFA) is inviting individuals to spend time checking the features and fees of their superannuation account to make sure they are in an option that suits their needs, and will deliver the best outcomes for their retirement.
ASFA CEO Ms Pauline Vamos says the superannuation system has gone through a period of innovation, delivering a diverse range of products and portfolios that offer people more choice than ever before. This innovation has occurred within 'default' super arrangements, as well as in 'choice' vehicles.
"This means people are free to make a range of choices about their superannuation, including what fund to invest in, the level of insurance cover and the type of investment management they want.
"Making choices about the level of assistance a person wants from the system will influence how much they pay in fees. For example, choosing an account with less features, a simpler investment option or lowering the level of insurance cover you have within your fund are all ways you might choose to reduce costs.
"It's also important to remember that costs are just one part of the equation when it comes to the decisions you make about your super. There are a number of other factors you should consider when working out whether your current option is best for you."
Ms Vamos says there are five key factors people should consider when making decisions about their superannuation fund or portfolio:
- Performance: "Superannuation is a long-term investment, so long-term returns are usually a better guide to fund performance than single year-on-year figures. Considering performance net of investment fees can also give you a clearer picture of how a fund is performing."
- Fees: "While lower fees may seem attractive, you may find higher fees are worth paying if the fund has a record of high performance over time, or offers services, including financial advice, that you value."
- Investment options: "Different funds offer a different range of investment options. Make sure you choose a fund that has an option which suits your circumstances and preference."
- Insurance: "Insurance provided through super varies greatly from fund to fund. Research the types of cover offered by each fund and make sure there is an option to suit you."
- Service: "Many funds provide online functionality or access to retirement planning tools free of charge to members, which may be an important feature for some people. In addition, the advice services provided through different funds can also differ, so looking at the additional services a fund provides may also influence which fund you choose."
"At the end of the day, what's most important is that people engage with their super. Knowing more about your fund and your account will help you make better decisions about your retirement savings," Ms Vamos concluded.
For further information, please contact:
Lisa Chikarovski, Media Manager, 0451 949 300.
ASFA is the peak policy, research and advocacy body for Australia's superannuation industry. It is a not-for-profit, sector-neutral, and non-party political national organisation, which aims to advance effective retirement outcomes for members of funds through research, advocacy and the development of policy and industry best practice.